Economist and sociologist Thorstein Veblen studied the relationship between the economy, society, and culture and suggested that a lot of people make purchases to display their status and accomplishments and not really to fulfill their needs. He is best known for introducing the concept of conspicuous (excessive) consumption and conspicuous “leisure” to signal one’s social status.
Theory of conspicuous consumption (Thorstein Veblen, 1899)
The term ‘conspicuous consumption’ was introduced by Norwegian-American economist and sociologist Thorstein Veblen in his book “The Theory of the Leisure Class” (published in 1899); the book is considered a criticism of capitalism.
The term refers to consumers who buy luxury items to display wealth and income rather than to satisfy their real needs.
Consumers display such behavior to gain/maintain higher social status. People from higher classes have a flashy consumer affect and influence on people from other classes as they try to emulate such behavior.
As per Veblen, the result is a society characterized by wasted time and money.
References
Book: Thorstein Veblen. “The Theory of the Leisure Class
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